The Leesburg Town Council voted 5-2 Tuesday night to adopt higher water and sewer rates designed to close an operational funding gap over the next five years.

The action followed a public hearing during which there were no speakers.

Mayor Kristen Umstattd and Councilman Tom Dunn voted against the motion. Umstattd had objected to increases in the fixed rates saying it would be too great a cost for a number of Leesburg residents. Dunn, who is challenging Umstattd in this fall’s mayoral race, said the town should focus on promoting additional usage from businesses and customers to spread the costs of operating the utility systems.

During Monday night’s work session, council members discussed Public Resources Management Group Inc. recommendations one last time and agreed to a change that reduced the fee reduction planned to help high-volume residential customers. A key change in the new rate structure is to eliminate the current policy of charging for sewer service based on the amount of water used by each account. Critics of that policy had argued that they were being charged for water used for irrigation and other outdoor uses that did not enter the sewage treatment system. Under the new plan, residential users will be billed for sewage service on the first 36,000 gallons of water used each quarter. At the suggestion of Councilman Kevin Wright, the cap was increased by council members from 30,000 gallons.

In addition to higher usage rates, customers will see an increase in the flat-rate base charge applied to all accounts when the new rate structure takes effect July 1, 2015.

Councilwoman Kelly Burk continued to press to keep the rate increases lower for commercial customers and suggested lowering the 30,000 gallon cap recommended by the consultant so more customers would enjoy lower sewer bills. “To me we’re not solving the problem. It seems like everyone is still tied to the same one-to-one ratio—that assumes customers’ sewer usage is the same amount used for consumption—unless you use an awful lot of water,” she said.

Umstattd said she was not as concerned with smoothing out the rates for commercial customers because they are subject to tax breaks that residents are not. “Water usage is a business expense for commercial users but not for residents,” she said. “I don’t want to see us put a greater impact on our residents.”

Vice Mayor Dave Butler objected to Wright’s proposal to increase the sewer cap, saying it went too far in shifting the burden to residents who irrigate their lawns and would essentially be picking up the tab for those who don’t irrigate.

Council members Marty Martinez and Tom Dunn looked for examples of area localities that have adopted the consultant’s methodology. “My biggest concern is where are we in relationship to the rest of the market in the area and does this rate appear to be fair,” Martinez said.

In the final version of the rate plan adopted Tuesday, residential customers, who on average use around 15,000 gallons of water per quarter, will pay $80.61 in FY 2015. That price will increase incrementally to $114.09 by FY 2019.

Wright’s proposal to increase the sewer cap to 36,000 gallons was balanced by higher sewer usage rates at $92.29 per quarter in FY 2015 with annual increases and reaching $118.93 in FY 2019. Butler again expressed his desire to keep the number at the consultant’s recommendation of 30,000 saying anything more would lead to “a few people paying a lot more for the sake of some people paying a lot less.” Wright’s motion passed in a 4-2-1 vote, with Butler and Councilwoman Katie Hammler, participating remotely, opposed and Dunn abstaining.

During final comments Dunn said he was hesitant to approve the plan arguing that instead of charging current customers more the town should be focused on building its customer base to alleviate the burden on residents. “We should look at it as a business recruitment and how do we get more customers and businesses,” he said. “We should not be penalizing people who use water.”

Hammler said the new rate structure is fiscally responsible, noting that future development was not going to solve the immediate problem of the town spending more on utilities than its is charging users.

Martinez said it was important for the public to understand that the decision is not a matter of wanting to raise rates but a matter of having to do so. He noted the council members’ utility bills would be going up as well. “We don’t get breaks…it hurts us, too.”